Agenda item 4 is an evidence-taking session on access to new medicines. I welcome to the meeting Shona Robison, Cabinet Secretary for Health, Wellbeing and Sport; Dr Rose Marie Parr, chief pharmaceutical officer for Scotland, Scottish Government; Angiolina Foster CBE, chief executive, Healthcare Improvement Scotland; and Professor Jonathan Fox, chairman, Scottish Medicines Consortium.
I invite the cabinet secretary to make a brief statement to the committee before we move to questions.
I am very pleased to be here this morning to talk to the committee about access to new medicines. As we enter the last few weeks of the parliamentary session, the committee should be very proud of its work in that area and the achievements that have been made in increasing access to new medicines in Scotland.
It is worth taking a moment to run through the main changes that have been made in the past two years—indeed, it is quite a list. The SMC now holds its meetings in public, and pharmaceutical company representatives are now part of those meetings; there is a new framework for considering ultra-orphan medicines; the patient and clinician engagement process has been introduced, together with additional opportunities for companies to put forward a patient access scheme; there has been an increase of around 40 per cent in the SMC’s acceptance rate for end-of-life, orphan and ultra-orphan medicines; and there is a pilot on early dialogue with pharmaceutical companies. I have heard much deserved praise for the public and patient engagement programme that the SMC has put in place, and that work is being fostered through a pilot to share SMC decisions in confidence with patient groups ahead of publication.
We have replaced the rare conditions medicines fund with an expanded new medicines fund. The amount available has been doubled twice—in consecutive years—and this year stands at £90 million. That means that the financial support has been available to implement the increase in access to new medicines. Moreover, the flexibility that the committee called for in individual patient treatment requests has delivered a tenfold increase in access to end-of-life, orphan and ultra-orphan medicines, and there is an on-going pilot for the peer-approved clinical system.
The establishment of an area drug and therapeutics committee collaborative has achieved some early successes in bringing together representatives from across Scotland. It has led national work on optimising medicines use; it is supporting and strengthening public involvement; and it is developing and testing a new categorisation and communication policy for formulary decisions. The final development to note is the establishment of a formal programme of work for monitoring clinical effectiveness of cancer medicines in real-life settings. I should point out that many of the changes have been delivered by the SMC and HIS, and they should be commended for their dedication to making the changes that the Parliament and the Scottish Government asked for.
To take—and to answer—the convener’s question, “Have we got more yeses?”, I think that yes, without doubt we have. However, we are not complacent. We need to continue to build on what has been achieved, and more needs to be done on fairer pricing of drugs for the national health service and on ensuring that the patient voice is at the front and centre of decision making. A key next step is the independent new medicines review, led by Dr Brian Montgomery, which will launch officially on 21 March with a stakeholder event in Edinburgh. Dr Montgomery will take stock of progress and advise us on whether the systems that we have in place are fit for the future.
Thank you, cabinet secretary. Our first questions will be from Nanette Milne.
Cabinet secretary, I share your enthusiasm about progress so far and agree with you that more can be made.
On the distribution of spending from the new medicines fund, I was under the impression that the fund was held centrally and that applications could be made to it. However, I have since been told that it is actually distributed to national health service boards according to the NHS Scotland resource allocation committee—or NRAC—formula. Which of those views is correct?
As the new medicines fund ensures that boards can deliver the policy intentions of the Scottish Government and the Scottish Parliament, it is the boards that receive the resources. In 2014-15, NHS boards required £1.1 million to support SMC decisions and £20.5 million to support individual and group patient treatment requests from the new medicines fund. Any funding that was not required by NHS boards for that purpose in 2014-15 remains available in 2015-16 on top of the new allocation that was made for 2015-16. We work closely with boards on monitoring the use of the funding to ensure that it is adequate to meet a board area’s needs, and we will continue to do that.
Witnesses at last week’s round-table discussion seemed unclear about which boards were using all their funds. NHS Greater Glasgow and Clyde said that it was using all of its funds and perhaps needed more. Are other boards using all of their funds, or are there are still more funds floating around that are not being used?
We have asked boards to inform us immediately if they have any concerns about their funding allocation, mainly on the basis of its being sufficient to meet anticipated expenditure, and no board has raised that issue with us. We make it clear that boards are expected to use their funds for the stated purpose over the lifetime of the fund. That means that they might not spend the funding in a particular financial year, but we would expect them to spend it over the lifetime of the fund.
There should be more transparency in the use of the new medicines fund. We had planned to publish details of the number of patients being treated and the relevant drugs but, as the committee might be aware, there is an on-going freedom of information request that asks us to provide details of the spend on the top 10 drugs. That has been an on-going complicating factor, as releasing patient numbers and spend on drugs poses a risk to commercially confidential information on pricing. Once that process has been concluded, we will publish the information that we were planning to publish, and I hope that that will provide a bit more information about how the money in the fund is being spent.
That would be welcome. In our discussion, we heard that people did not know how many patients were being treated, what therapies were being provided and so on.
Do you think that the fund will continue to be funded centrally? I know that at the moment it is funded through the pharmaceutical price regulation scheme. Is that likely to continue?
What happens beyond the current PPRS agreement is an important issue. As the committee will be aware, the scheme is negotiated between the United Kingdom Government and the Association of the British Pharmaceutical Industry. The Scottish Government and the other devolved Administrations had asked for inclusion in the previous negotiations but, unfortunately, that was refused. However, the Scottish Government has had greater involvement in the operation of the current PPRS and, post-Smith commission, there are on-going discussions about how Scotland can be included in future negotiations and decisions, whatever form they might take. Therefore, if the UK Government wants to negotiate changes to the arrangements, we want very much to be involved in that, and I am sure that Wales and Northern Ireland feel similarly. We also have the support of groups such as the Scottish cancer coalition in that regard. It is important that we have a voice in discussions around any replacement of PPRS.
I am looking for some clarity on the information that this and a future health committee will get and in what timeframe with regard to a breakdown of the spend on new drugs that are recommended by the National Institute for Health and Care Excellence and the SMC as well as those that are not recommended by the SMC. Can we get all of that information broken down?
09:45
We want to furnish you with as much information as possible. As I have said, things have been complicated by an FOI request that has delayed our putting out that information.
One issue is information that strays into the commercial in confidence domain, where there are negotiations with pharmaceutical companies around price. Obviously there are sensitivities in that respect, but we want to provide the fullest information that we possibly can and to be as transparent as possible in that. Do you want to say a little bit about that, Rose Marie?
Transparency is an important issue. We definitely want to give information on that matter where we can; indeed, it is important that we do so.
With the new medicines fund, we have wanted to ensure an increase in access. That positive step has allowed NHS boards to deliver on the policy intentions of the Scottish Government and the Parliament with regard to increased access to new medicines. That is an important area. We want to be very involved before 18 December, which is when the fund might change, and in how the fund might be used in the future.
The cabinet secretary might be intending to publish all that information, but I presume that information about, say, total spend on drugs that have not been recommended by NICE or the SMC will not get round the confidentiality issue, any business case or whatever.
We would want to publish as much information as possible. I suppose that where we get into difficult territory is where an association can be made between individual patient numbers with regard to a specific drug and the cost of that drug, because you can then work out the price. There are also commercially sensitive issues around the pricing negotiations that pharmaceutical companies might have. Angiolina Foster might wish to say a little bit about that.
I simply endorse the comments that have been made. With regard to our fundamental desire for maximum transparency, the trade-off is the commercial in confidence issue. We just need to be careful not to create any unintended difficulties there.
The committee is trying to judge what would have been available anyway and what is now available that was not previously available, because that is what will tell us whether we have got more yeses. I should say that the evidence that we have received in written and oral form reflects the view of the committee and the cabinet secretary that we are making good progress here, so we are not trying to be negative in that sense.
The new medicines fund is funded by the rebate agreed through the PPRS. Last week, we heard evidence from, I think, NHS Greater Glasgow and Clyde that this year there was a funding issue—I do not know whether it can be accurately described as a funding shortfall. Is that a result of the reduction in the rebate? Does that present us with challenges in the shorter term? What do we expect the rebate to be able to fund in the existing scheme? I should say that, during this evidence session, we will probably discuss what the future will look like and how it will be funded.
As PPRS receipts are expected to be lower across the whole of the UK, not just across Scotland, this is an issue across the board. The funding is based on an estimate of what we would expect to receive. We will have to manage that, and we will work closely with boards to ensure that we manage the budget. At the end of the day, the most important thing is that patients receive the support that they require and that the fund is used in the most appropriate way. As I have said, boards have the ability to manage the fund over a number of years to ensure that that kind of pressure does not arise in one financial year, and we will work with boards to ensure that that happens.
I guess that we will want to discuss around table any schemes to replace PPRS. Under the current system, you make an estimate and build your fund on the basis of that estimate, and issues can arise if those things are not in sync. We have had a bit of that this year. Last year, that was not the case—it was different. We do not know what will happen in future years. Perhaps as part of a review of PPRS we might want to look at whether we can better match the anticipated receipts and the funding that would come in when we set the budget for our new medicines fund. I am not sure how we would do that, but it would be good if we could.
So this year’s shortfall, as described in last week’s evidence by NHS Greater Glasgow and Clyde representatives, will not impact on patients or patient access to new medicines.
No. We will work with boards to manage that and ensure that there is no detriment to patients.
Does that mean that the Scottish Government will make up that shortfall this year?
As I have said, we have asked boards whether they anticipate any problems with the resources and the demand that they have. At the moment, they have told us that they do not, but we are keeping a close eye on the situation. Boards are not saying that they will be unable to manage patient demand with the resources that they have, but if resources are required then obviously—
As a matter of interest, would that include NHS Greater Glasgow and Clyde, which told us last week about a shortfall?
Yes.
It absolutely would.
Is it the case, then, that this will not impact on patients and that it can be overcome either by health boards or by the Scottish Government?
Yes.
Is there any way of forecasting whether this year will be just a blip or whether there be an impact over the next session of Parliament?
That is a good point, because horizon scanning in this area is quite difficult. However, although it is difficult to predict future spend, the Scottish Government works with HIS and the boards themselves on horizon scanning for new medicines fund expenditure. We work quite closely on that with boards, and it is a continuous process; that is how we draw up our horizon scans for boards as part of their financial planning. Some financially sensitive information is included, and the process with estimates is an on-going one. We want to continue to do that and to improve our horizon scanning as much as possible.
Does that mean that there will be increasing pressure on the money for funding this scheme?
There will probably be increasing pressure on the new medicines fund money, but it is definitely not at risk just now. I think that it is reasonable.
Does the issue need to be looked at in the review?
We certainly want the independent review to take stock of all progress to date. Indeed, it would be a really positive thing for Dr Montgomery to do. The other key area that we want to look at is commercial negotiation on price to ensure that we can do better under our current system by getting a better price. We want to look at improvements in that respect, too.
The new medicines fund is important. It has allowed boards to increase access to new medicines; indeed, there has been an increase of around 40 per cent in SMC acceptance with regard to medicines for end-of-life, orphan and ultra-orphan conditions, but we definitely want to negotiate better on price to ensure that Scotland gets better value for the money in the new medicines fund.
I am sure that we will come back to that issue.
Two of the issues that have been prominent in the oral evidence, which you may have read, and in the written evidence are PACE and the IPTR. People really appreciated the extent of patient and clinician involvement, but two questions arose from our evidence on PACE. First, it is good to have pre-meetings, but there is concern that there is no possibility of questioning patients or clinicians at the final SMC meeting. Quite a few submissions and comments that were made in evidence last week suggested that that would be beneficial.
The second issue is evaluation of decision making by the SMC—in particular, the impact of PACE on it. I do not know whether we have any information on that or whether there are any proposals to evaluate it.
I would say that those are the two main issues that came up in relation to PACE, although the evidence is positive about what PACE has achieved so far.
As Malcolm Chisholm said, we have received pretty positive feedback from patient groups about how their views are being taken on board and into account through PACE. One of the specific areas that I have asked Dr Montgomery to look at is whether more needs to be done around that. Malcolm Chisholm also mentioned the end point of decision-making. We have made huge progress but we know that more can be done and that further improvements can be made. Dr Montgomery will look at that—I am sure that he will make recommendations that he thinks could further improve the system.
I will kick off the questions about the IPTR, although I am sure that colleagues will want to follow up on it. The key issues are consistency and transparency—people have made various comments about how those might be addressed. Although the extent to which the IPTR had delivered more positive results for patients was welcomed, concerns were expressed about consistency among boards, about their decision-making processes and about the transparency of those processes. Are there any proposals to deal with that? To what extent will PACS address those issues when it is rolled out?
As you have recognised, the extension of flexibility that the committee called for has led to the tenfold increase, from the time of the committee’s inquiry. We can think about specific examples of where the IPTR has worked, and I know that the committee has heard direct evidence from people who have benefited. From the outset, we have been clear that there should be a reduction in reliance on PACS to access medicines, as a result of changes that have been made at the SMC. Dr Montgomery’s forthcoming review will test how that has worked.
If the system had been rolled out in May 2014, it would have been ahead of a body of decisions that were being made by the SMC under its new process. The extension of flexibility has allowed 500 patients in 2014 to access orphan or ultra-orphan drugs that were not recommended by SMC at the time. The rolling out of PACS has coloured our view of how it should be done—that is why we went to the pilot. We recognised that the process was working quite well, so we did not want to jeopardise it by moving to a new system too quickly. That is why we are having the pilot in NHS Greater Glasgow and Clyde.
It is also fair to say that boards have adapted their decision making. They have applied the flexibility and we have seen the evidence of that in the numbers. The new medicines fund has supported the change of approach; that support has been important.
However, there are always going to be individual decisions and circumstances. No system can get away from that altogether, including the IPTR or PACS. Guidance to boards states that they should share best practice. We have encouraged that and are keeping a close eye on decisions that are made either way.
We are in a better place and we are moving forward with caution through the pilot and the move to the new system. We want to make sure that we continue with improvements, although difficult and unpopular decisions will still have to be made under the IPTR or PACS. No system will ever address that perfectly, but we are in a much better place than we were previously.
10:00
I have a final question. What are the main ways in which PACS is different from the IPTR? It is being piloted. Is it about the detail or are you still exploring some fundamental questions about PACS?
The changes that are being tested in the pilot are focus on capturing measurable clinical benefit and monitoring of outcomes and adverse events, which is key, prescribing clinicians seeking peer support on an individual-patient basis, the use of a panel of clinicians to oversee cases, and the consistency that it delivers. The focus of PACS is on the clinician being very much at the centre of the process but with oversight of it. So far, nothing in the pilot causes us any alarm. Perhaps Rose Marie Parr can say a bit more about it.
We think that some good information will come out of the pilot—not least through its trying to capture more information and to measure clinical benefit. We are less good at seeing what happens when a drug is out there with a patient—whether it is delivering what it was supposed to deliver or whether it is delivering more or less. How can we capture that information and feed it back in to the SMC for future reference? It is about trying to complete the circle of real-time information.
That is right. I think that we are being cautious in the PACS pilot, which is the right approach. The outcomes of the pilot will be very important. We will also involve individual clinicians more.
We hope that, in the longer term, there will be less reliance on systems such as the IPTR and PACS, with the SMC’s decisions being the ones that we stick with nationally. We will look at what happens with the pilot and roll-out through the independent review and we are open to making further changes, if necessary. As the cabinet secretary said, it is an interesting and difficult area for some people, so it is helpful that we are proceeding with caution.
We want to see the main route for access to pharmaceutical companies being in putting a good case through a good-quality submission, with a fair price and offering at the SMC first time around. That is what we would like most, but we will take all the routes into account.
I will offer a couple of comments on the first part of Malcolm Chisholm’s question about PACE. You asked whether it would be desirable for patients and clinicians who have been part of PACE also to be present at the SMC meeting. One of the organisational arrangements that we have deliberately put in place is the patient involvement network, which is a support and consultative mechanism whereby we look, in a spirit of continuous improvement, at how the current arrangements may evolve over time. My sense is that, from the point of view of our internally driven—so to speak—continuous improvement, the patient involvement network may be the place where such proposals may come from, be looked at and mature.
The second aspect of Malcolm Chisholm’s question about PACE was on its impact. I genuinely believe that the figures speak for themselves on the outcomes of the SMC’s decisions before and after the introduction of PACE. I am sure that Professor Fox will wish to speak for himself, but I know that he is always very clear with his committee members about the importance that they ought to place on output from PACE meetings as a crucial part of the deliberations of his committee.
Rhoda Grant has a supplementary question on the same subject, and I invite similar questions on the process from other members.
My question is about how the IPTR system currently operates. People still express concerns that some people get access to medicines that others do not. That discrepancy looks more stark when they are being treated by the same clinicians, but come from different health boards.
I imagine that the information would be the same if it is coming from the same clinician, so it cannot be about whether the treatment can make a difference. What are health boards basing their decisions about those requests on? How transparent is the process, and how will it change?
The clinical decision might be that one patient may benefit from that treatment while another patient may not, or it might be that the side effects could be such that a patient could not tolerate the treatment. We do not know what discussions are had about the clinical needs of patients, so a clinician might make different decisions about the same drug for two patients. Two health boards might make different decisions about a drug and a patient: we do not know the circumstances of those patients, which may be quite different.
That said, we keep a very close eye on ensuring that if we consider that a process raises questions, we look at that process and ask pertinent questions about it. The fact is that we have seen a different approach across the health boards overall—the numbers speak for themselves and would not be such as they are if that was not the case.
Ultimately—as I said to Malcolm Chisholm—there will be occasions when difficult decisions are made. We expect those decisions to be based on clinical judgments, and we expect boards to use best practice and guidance to inform their approach, whether under the IPTR or—in the future—PACS. If members think that that has not been the case and are aware of stand-out cases that they want us to look at, let me know and we will do that.
How much work have you carried out with clinicians? Do you speak to the Beatson west of Scotland cancer centre, for example, and listen to what it says about different health boards giving it the okay for different drugs? It is treating patients, so it would know what information patients are feeding back to the health boards, and whether patients have differing outcomes. I do not have a specific example but, anecdotally, it seems that health boards take slightly different approaches.
Yes, we do. Rose Marie Parr will say a bit more about that.
That is an interesting area. Patient numbers in such areas are small, so it is quite difficult to interrogate the data. The data that we have to date show no evidence that there is a postcode lottery, although people perhaps have that impression. Individual decisions are taken for individual patients. It is right and proper that those decisions differ.
Before the policy changes were made, about 50 patients were accessing ultra-orphan, orphan and end-of-life medicines through the IPTR. By 2014-15, that number had increased to over 500 patients. The numbers are quite small, but we can see increased access. We have only anecdotal evidence that there is a postcode lottery, and we do not think that the numbers back up those claims.
One thing that we can do, and which the Scottish Government would help with, is share information among boards. Last week, the committee heard from clinicians that for some very small areas it is really good for clinicians to share information, so we encourage that.
You and others will be aware of the written evidence that we have received and the oral evidence that we received last week. Most people have made the point that we are talking about evolution and are not criticising the progress that has been made. It is worth putting that on the record again.
I return to the subject of price. I have listened carefully; Rose Marie Parr said that you want to negotiate better on price for the NHS, and the cabinet secretary said that you want to get the best deal for the NHS. Angiolina Foster’s submission to the committee ahead of this evidence session says:
“Healthcare Improvement Scotland believes that the assessment process is best served by pharmaceutical companies offering a competitive price from the outset. The price considered in the assessment may involve”
a patient access scheme. Woven throughout all that, of course, is the fact of commercial confidentiality.
The theme again and again is that we could do better on price. That can mean only that pharmaceutical companies are charging more than we expect to pay for medicines. There is an obvious benchmark for me: are we getting as good a deal as England gets? I am keen to know whether we are negotiating as hard as we can on price and whether the pharmaceutical companies come to the table to make the best possible deal.
I spend much of my time working constructively with pharmaceutical companies as key stakeholders, but they are also private companies, so striking the balance between maximising shareholder profit and their corporate social responsibilities can be quite tricky. Prices have come up repeatedly in evidence this morning, so are we getting the best deal? What more can we do? How does the situation here compare with that elsewhere in the UK?
Price has already been a really important area, and it will be very important as we go forward. We have monitored the issue very closely, not just in relation to medicines that fall within the SMC’s new approach, but generally.
The short answer is that we do not always get to the company’s best price first time round, or even at all, although I should be clear that not all the pharmaceutical industry behaves in the same way when it comes to pricing, and although companies are absolutely entitled to make commercial decisions on how they price their drugs, it is incumbent on all of us to ensure that the NHS has systems in place so that the best value is achieved and the need for time-consuming resubmissions to the SMC is avoided.
We take the view that there should be external commercial negotiations that are linked with the SMC process. The pharmaceutical industry could also do better on fairer pricing without unduly impacting on returns for its shareholders. If we get that to a better place, things such as the new medicines fund can go further and support more people. If a pharmaceutical company is able to offer a better price elsewhere, we would expect there to be no reason why it could not offer that better price to the NHS in Scotland, as well.
I have asked Brian Montgomery to look at how we can make those improvements. There are in the systems potential ways to have an earlier discussion to avoid reaching the position at the end of the process at which a better price is offered on resubmission that could have been offered in the first place, although sometimes months will have elapsed. There are definitely process issues that can be tackled to get to that better position.
As I said, we think that there should, linked with the SMC process, be external commercial negotiations that can drive a fairer price. We are very keen to pursue that.
I absolutely agree. The only thing to add is that the Scottish Government can monitor price closely because we have access to commercially confidential information. That allows us to say that there could definitely be improvements in some areas, which would allow the new medicines fund, for example, to go further. We would like such improvements to come out of the review.
10:15
Do either of the other witnesses want to add to that before I move on?
I agree with everything that has been said. However, I note that the SMC does not negotiate on price, as that would conflict with its role in medicines assessment.
An additional point about getting the best deal is that the new processes and the PACE meetings allow companies to come back with a new or improved patient access scheme or confidential discount, which has helped on a number of occasions to improve the cost effectiveness of medicines. We have had about seven such occurrences, four of which resulted in eventual acceptance. That has helped with the ability to get medicines at the best price.
That is helpful.
Convener, I should point out that I have met pharmaceutical companies frequently. I add for the record that I have never been paid to meet them and that it is done in a constructive, collegiate way—
Too late. [Laughter.]
—given my role on this committee.
The important point is that I have never yet met a company that has not said that it is in this for the best interests of the patients and the people it serves. I am therefore sure that, if better deals are being struck elsewhere in the UK, the companies will want to look at that carefully and work constructively with the Scottish Government to ensure that Scotland gets a better deal than we are currently getting. I am sure that they were listening to the exchange that we have just had.
To move the debate on a bit, I note that we are also hoping to develop a Scottish model of value. The committee was keen to see that, having taken evidence on value-based pricing back when we were doing our initial inquiry on access to new medicines. I would be keen to hear any update that is available on that. In particular, my interest has always been in cases where the clinical evidence from trials is not as mature as it could be or does not have longevity. I apologise if my terminology lets me down; I suppose that I am referring to results-based reimbursement, for lack of a better description, and maybe even reimbursement in instalments. If someone can sustain employment for longer because of a medicine or if they have fewer social care needs because of a pharmaceutical intervention, that creates time-releasing savings in the health and social care sector, although there are up-front costs to the NHS for medicines.
It is in that context that I view any Scottish model of value. Pharmaceutical companies would be key stakeholders, working in partnership to develop that model. Is there any progress on that? Where are we with it? Can we hope to see something in the near future?
We said from the outset that the new approach that the SMC adopted would be the first step in developing a Scottish model of value. The independent review under Dr Montgomery will consider whether the progress that has been made to date provides a solid base for developing the concept further. Some of the points that you make are very fair.
I agree. There will be a lot of interest from both patient groups and the industry in seeing how we build on that model of value, and the new approach is part of that. Our new framework for end-of-life medicines and orphan and ultra-orphan drugs includes modifiers. That type of value can be taken forward as well, and patient and public involvement, the PACE process and the pilot PACS can all be added to the model. That represents solid movement on the way forward.
There are issues around trying to look at evidence and outcomes. I agree that sometimes the narrative is about not just access to new drugs but how they are used and what outcomes we get from them. We will definitely look at aspects of the context of new medicines and what evidence there is on what they will deliver both for the patient and for the NHS, and we certainly expect the review to look at the real-time health technology assessment that I think you were referring to. That definitely needs further consideration, for policy and practice in future. However, we would want to look at that as part of the wider group. We would also want to see what companies and countries are doing nationally and internationally in the area of health technology assessment. It would be very positive to go into that, too.
Professor Fox, you said that the SMC does not negotiate the price, but an issue that has been raised by people who have tried to access new medicines is that, sometimes, even when the only thing that has really changed is the price, a new medicine has become available, which sort of sours the principle that price does not really matter. As we know from written evidence, and from oral evidence last week, the process is important to people.
There is also the issue of openness. The pharmaceutical companies have said that, whether the decision was right or wrong, if they knew more about the initial discussion and why a new drug was refused, they would be able to respond more quickly. The process itself has been criticised by all sides. The Government says that the process is not working for it from the point of view of price. The patient is denied access to a medicine or it takes longer to access it, and sometimes it is too late. Rightly or wrongly, a negotiation takes place, with people saying, “Let’s hear what you’ve got to say. We might able to offer you something.” To all intents and purposes, there is a negotiation, but the process has been highlighted as one of the things that are causing problems. Will such issues be addressed by the review, and if so, how?
A key issue that Dr Montgomery’s review will consider is how we get the best price as early on in the process as possible in order to avoid the scenario that you describe. The review will look at how we can have an external process that, although linked to the SMC process, basically drives the discussion at an early stage, in which we say that what we want out of the process is the best, fairest price at the earliest possible stage. We want to avoid what you describe, which is a resubmission at the end of the process, with a different offer. We need to focus on getting the right set of procedures in place. Some of that, although no doubt external to the SMC, will have to feed into the SMC in the right way. A key ask of Dr Montgomery is to take that forward.
Are we more likely to get a better price from pharmaceutical companies if we work with the UK Government or other European Governments, which are all competing? That is the market. How do we circumvent a market in which a company can sell a drug in Italy because Italy is prepared to pay twice the money for it? Given our population size, and our demand and spend, how do we get a better price than our neighbours with populations of 60 million? We could seek a Scottish solution to taking on global companies, but are there opportunities here for Governments to work together to ensure better pricing?
I sense that we are wrestling with three quite distinct concepts.
The first is the best pursuit of the best possible price for Scotland in a commercial context. The point that you are rightly flagging is that it is a global marketplace, so any improvement in the processes that Scotland deploys for commercial negotiations will need to recognise the global nature of that marketplace. That is concept one, if you will: the commercial issues.
Number two is the question of the overall affordability for Scotland’s NHS of the drugs bill. That is quite distinct, and it is clearly a policy and value issue. The third concept is one of cost and clinical cost effectiveness. It is that third area—and only that third area—that is the business of the SMC’s professional and public deliberations.
Those three things clearly interplay, but the mechanisms and possible maturing of each of them may take separate routes. Jonathan Fox may want to say more.
Depending on what system is devised and developed for price negotiations, and depending on where in the process it comes in, the SMC’s expertise can be very valuable in informing the system, without specifically taking part in its development. That is undeniable.
Having the SMC’s health technology appraisal system has helped to get the best prices. Without it, the market would be far less controlled.
You talked about how price might still be a factor. Clearly, it is. Access to new medicines cannot come at any price. That has been stated many times, even by patient groups. We have, very deliberately, increased flexibility following the committee’s advice and the cabinet secretary’s instruction a few years ago, and there is no question but that that has increased access to these medicines. In addition, we have downgraded the importance of the cost-effectiveness information for ultra-orphan medicines. However, overall cost effectiveness—value for money—must still play some part in drug decision making.
By the SMC?
Yes.
Is the current procedure for dealing with that—the quality-adjusted life year and all that—still the appropriate way to evaluate?
It is an appropriate way to deal with the great majority of medicines. Remember that we deal with a lot of medicines that are not for the end of life or for very rare conditions.
And at the current level of cap on cost per QALY?
That is outside my personal domain, but there is an interesting argument. You heard evidence three years ago about what the QALY’s true cost in the NHS might be. We have conventional ways of assessing these medicines: the thresholds are not strict, and various issues can be considered along with the cost per QALY. We have much increased the flexibility for some medicines. However, the current procedure is a proper way—or at least a way—of evaluating.
We have also offered people the opportunity to use other arguments, let us say, for very rare conditions—ultra orphans—but that is still at quite an early stage.
Does that need to be developed?
We are trying to develop it continually. Again, it is a question of our relationship with the pharmaceutical companies and getting an understanding of what may be acceptable in those unusual circumstances.
Will the review deal with the cost per QALY and rare and orphan diseases, cabinet secretary?
Yes.
We have to be slightly careful on the cost per QALY. I apologise if I get the numbers wrong, but back when we did our initial inquiry, the rule of thumb for a bog-standard drug—although I know that there is no such thing as a bog-standard medicine—was £25,000 to £35,000, depending on the clinical evidence. That was what was affordable. A pharmaceutical company might have been prepared to settle for £20,000, but given that the crib sheet is so rigid, why would it not put in a bid at £35,000, at the top end, if it knew that the cost per QALY threshold was £35,000?
I know that Professor Fox does not deal with the pricing negotiations, but is there realpolitik in those discussions, in that you have to be slightly careful not to set out a rigid crib sheet on what the cost per QALY is? Why would a company not just go in at the top end of it and maximise its profit if it could do that? Does the cost-per-QALY chat come with a health warning?
10:30
Yes. The fact is that, in the real world, competition helps. Remember that, after the SMC process, there is scope for tendering and cost negotiations. Even after some medicines have been accepted at a certain cost—that can include the confidential discount; it is not necessarily the list price—there are opportunities for further negotiation at a national or a local level. I guess that there is a difference between what might be regarded as a price that allows cost effectiveness and the best price, which the cabinet secretary mentioned in her opening statement.
Is that where the independent commercial discussions could take place, in tandem with but not as part of the SMC process?
Yes, although they would obviously have to relate to the SMC process and it would have to provide an input into them. We have asked Dr Montgomery to look at how that might work, what synergy there might be and the practicalities of how those discussions would sit alongside the SMC process—who would be involved and how it would work in practice. It is clear to me that getting the best price—which will be a fair price—for Scottish patients and taxpayers is very important, and we believe that there is room for improvement. We want to ensure that we get the best deal.
Has the number of co-payments, where patients fund their own access to medicine, declined with the introduction of the new system? One of the main issues with the old system was that some patients could afford to make such payments to access new medicines, whereas others could not.
There is some chief medical officer guidance from 2009, I think, that covers more than medicines but which was introduced to allow work on access to medicines in a previous parliamentary session. That guidance remains in place, although we are not aware that its provisions are being widely used—the Scottish Government does not hold that information centrally; it will be held by the boards.
We would be quite concerned if patients were paying significant amounts of money for treatments that did not provide a great deal of benefit. Going into and through the review, the CMO’s work on realistic medicine and the whole area around how we want to speak to patients about shared decision making might provide an opportunity to discuss the matter further. Indeed, shared decision making between clinician and patient might provide an opportunity to look at some of those issues. Some of the drugs can be difficult to take and quite toxic, and that end-of-life discussion is very important.
I think that, if the issue was widespread, I would know about it and people would be raising it with me regularly, but that has not been the case. It is something that we need to keep a close eye on but I am not aware, from issues being raised with me, that it is a common occurrence.
I do not think that it is a common occurrence, but it occurs and we have taken evidence on it. When we looked at the system previously, there were issues around people paying for their own medicines and then, because they were already paying for their medicines, having to pay for treatments that they would have received free on the NHS, such as scans or blood tests.
My understanding is that that has now changed, in that they would pay for the drugs separately but would receive other treatment on the NHS. However, there is concern about delays around who pays for what. I am looking for some information on how the process could be speeded up to ensure that there are no delays in treatment. We were given the example of someone who got access to the drug treatment that they were looking for only weeks before their death, but had the co-payments been sorted out sooner they would have had treatment with that drug sooner.
I am certainly happy to look into particular cases such as that one. You have said, quite rightly, that the CMO’s guidance changed to ensure that the issues that you cited around aspects of treatment other than drug treatment were resolved. The number of cases is small, and we need to have relatives’ permission to look into individual cases, but I am certainly happy to do that if there are still issues around timing. As I understand it, we are talking about a very small number of cases, and ultimately there still has to be a clinical judgment about whether someone could be harmed if they decide to go ahead with treatment when their clinician is of a different view. The clinical judgment in those matters is still important, but I will look into the circumstances in the case that you have raised.
That would be useful. We would assume that, if the system was working right and the clinician thought that a drug treatment would be beneficial, there would surely be access to that drug so that people would not have to consider funding the treatment themselves. That was an issue historically, because those who could afford to fund it could access treatment and those who could not afford to fund it could not access it. It would be good to look at the issue in the round to see, first, whether it is happening—whether NHS treatment is being provided free and quickly—and, secondly, in what circumstances it is happening and whether the system is picking up on it.
We will do that.
I have several questions. In these islands, in the context of the United Kingdom, there are two distinct countries: Scotland and England. In England there is NICE and in Scotland there is the SMC. One of the comments that patients always make to me is that if NICE accepts a drug it is then brought to the SMC, which might not accept it. Why is that? Should we not be working together so that, if we have accepted a drug or the English body has accepted a drug, the work that has been done on that acceptance can be taken on board by the other organisation?
It works both ways. There are drugs that are approved by NICE on which the SMC takes a different view; similarly, there are drugs that are approved by the SMC on which NICE takes a different view. I will hand over to Angiolina Foster in a second, but I should mention that a decision has just been made to bring the cancer drugs fund into NICE. Various views have been expressed about that, but our approach has been different, in that we believed that it was important to have a sustainable position. We had concerns that the cancer drugs fund would be pretty short term, and the question was, “Then what?” The answer is that the cancer drugs fund is now going into NICE and will essentially be absorbed through the NICE processes. Concerns are being raised because until that happened there was a different process. We have taken a more sustainable view of making the improvements incrementally and not putting all our eggs in one basket, with all the difficulties that have followed for the cancer drugs fund.
It is a good challenge, Mr Lyle, but I ask Professor Fox to give you a more detailed explanation.
The SMC started about 14 years ago, and its role was to assess all new medicines or significant new indications for medicines. We continue to do that. NICE has never had quite that remit, so there have been differences from the beginning. NICE selects medicines to appraise. Given the philosophy that Scotland should have a system that appraises all new medicines, I guess that that is one of the reasons.
The next reason relates to the notion of the circumstances of the population in Scotland being different from the circumstances of the population in the whole of the United Kingdom. In addition, increasingly, there is the fact that the NHS in Scotland is rather different from the NHS in England. I am giving you a number of reasons why I believe that the SMC should continue to exist. I would say that, of course, but I think that those factors are relevant.
Do we co-operate with NICE? We certainly do. Incidentally, NICE produces excellent output—there is no question about that—but its processing has traditionally been very much slower than ours. We have tried to make our decisions quickly so that we can shape future practice instead of having to change established practice. As well as being comprehensive, we have been rapid—and we still are rather rapid, even with the small increase in timescales that is related to the PACE process.
As far as co-operation with NICE is concerned, we talk to each other and read each other’s output, but we co-operate on more levels than that. In particular, there is a thing called the multiple technology appraisal, whereby NICE is able to compare many existing medicines or other treatments within a specific disease area. We do not do that, but it can be very useful. The process often does not involve brand new medicines but looks at a therapeutic area in which there are several medicines. We usually adopt those via Healthcare Improvement Scotland—we have a mechanism for accepting them for use in Scotland. If we do that, that supersedes previous SMC advice. Therefore, we work closely in that respect.
I am not suggesting that the SMC should be done away with and taken over by NICE—quite the reverse is the case. The point that I am making is that people ask me why people can get a drug in England but not in Scotland. I know that we are taking steps to address that.
In a way, you let the cat out of the bag earlier when you suggested that the eventual acceptance of a drug is based on price. Last week, several witnesses suggested that we should have a hard negotiator who would negotiate the price. Is a drug eventually accepted in Scotland if the drug company comes back and says, “We made a mistake” or, “We can negotiate” or whatever? Is that a rule?
I think that we should distinguish between the bulk of medicines that we deal with and those that are in the end-of-life category or the very-rare-condition category. In those cases, although we do not state a specific threshold, it is clear that the cost per QALY—not the list price, but the cost that the medicine represents to the NHS in Scotland compared with the benefits that it brings—is a major factor.
I want to correct an impression that was given at last week’s meeting of its being just about the cost; it is not. It is not just the price or the cost of the medicine that we consider; we take into account all the healthcare-related costs in the conventional process for the new medicine compared with those for the comparator medicine—the previous medicine. By no means do we take into account just the price of the medicine; we look at all the costs, including any costs of not using the new medicine. That is all taken into account.
As I have said, we have a lot more flexibility in the new process, which has been shown by the increased acceptance rates that we have had. Indeed, for the ultra-orphan medicines—the medicines that affect very few people in Scotland, such as fewer than 100 people or thereabouts—price is even less important. However, it is difficult to sustain the argument that access to medicines can come at any price given the enormous price of some of the new medicines that are coming to market.
10:45
Like Bob Doris, I have had meetings with certain companies and the first thing that I have said to them is that their medicines are too dear. As you said, let us live in the real world, which is that we want the best for people in Scotland but we also want it at the best price. I agree with you.
Let us move on to something about which I do not know much and about which you might wish to enlighten us. Comments have been made about the membership of the SMC and about whether there are patient representatives on it. I am not asking you to name the SMC members individually, but how are they appointed?
It has also been commented that, although the SMC allows the public into its meetings and although more meetings have been held and the SMC has become more transparent, the votes that it takes are not made public. Will you explain that?
From the beginning, the SMC has led the way in involving public partners and the industry as full voting members of the committee. It includes three public partners and three representatives of the pharmaceutical industry, who are nominated by the appropriate groups, as well as managers, finance officers, chief executives and a range of clinicians—doctors, pharmacists and nurses. It is a very diverse group containing all the appropriate stakeholders.
The other factor that we take into account is that we want representation from all the health boards in Scotland. We try hard to ensure, whenever possible, that the SMC covers the whole of Scotland in terms of the territorial health boards. We try to balance it in that way.
The SMC is a consortium of area drug and therapeutics committees, and the clinical representatives are nominated by them. We do not go out and pick people; we ask for nominations and then choose the nominees who best fit the necessary mix of skills and geographical representation.
Your second point was about voting. I have looked through all the written submissions, and the same point has been raised by a few of the pharmaceutical companies and the ABPI. I have some understanding of why.
When we moved to meeting in public, we changed to a system of paper ballots for the vote. That decision was made by a committee that included representatives of the pharmaceutical industry. We were told clearly that we could not reveal the result on the day because of possible effects on the share price locally and internationally as well as other commercial and, maybe, other considerations. Therefore, we could not use the previous method of an obvious consensus or a show of hands.
We have moved to paper ballots, which is the most appropriate method on practical grounds and on the grounds of transparency because we can assure the public that they have seen every bit of the discussion of the medicine. We have the entire discussion to the end and then ask for a vote. The votes are then taken away, they are counted and the results are announced to the committee in a short private session afterwards. We do not discuss the medicine again because that would not be in the spirit of full transparency.
The only exception to that practice has been that, in a very few cases—in the cases of, I think, seven out of the first 125 submissions—we have had to have a short private session to discuss commercially confidential information. In order to allow the whole discussion to take place in public, we have handled that by referring members to the paperwork instead of reading out the figures.
I could go on about why it would be difficult to change the process, but I suspect that you do not want me to.
There is one point that you have not answered. I know that it is hard to ensure this, given all the different organisations and patient representative groups that are out there, but is there a patient representative on the SMC or is it intended that there should be one?
There are three public partners who, as it happens, have extensive personal experience in the healthcare context.
I think that you may be referring to whether we should have patients presenting the PACE statement. That was not recommended by the task and finish group, whose recommendations were the basis of our new process, but I think that the matter will be considered in the review.
Malcolm Chisholm has a question on the same theme.
It was useful to be reminded of the SMC’s origins and how it was set up to be different from NICE. However, in the past, there were problems in ensuring that boards implemented the SMC’s decisions. Does that problem no longer exist or is that still a problem? Do you audit the extent to which boards follow and implement the SMC’s decisions?
I am not aware of any systemic problem with boards’ implementation of the SMC’s decisions. The figures would not be as they are if that were the case, and we are not seeing any stand-outs that are running counter to the direction of travel of other boards. I am certainly not aware of any issue.
In many ways, having boards speak to each other has been one of the success stories. Indeed, there is a new collaborative, with boards speaking to each other through the area drug and therapeutics committees. HIS hosts those committees, so it may want to comment on the matter. There has been success there in the sharing of best practice.
The timeframe in which the Government expects boards to take decisions on SMC advice is still within 60 days of its publication and boards are meeting that deadline, which is also important.
The wider issue around collaboration is that there should be more consistent communication of boards’ decisions across Scotland. That will be important going forward. We definitely want to see collaboration continue between boards’ area drug and therapeutics committees, as that collaboration has been one of the new framework’s success stories.
A mechanism that Healthcare Improvement Scotland has—again, very deliberately—put in place to support that is the collaborative, which is designed to address any perceived inconsistencies or differences in timeframes for implementation on the ground of the SMC’s decisions. We sense that a number of the perceived differences are to do with inconsistencies of language, right down to issues of vocabulary and how the process is being described locally. Although, on one level, it may sound a little mundane or trivial, we are finding that the material that we provided to the collaborative and shaped with its members around the consistent use of words and the description of activity on the ground is beginning to dispel any perception of inconsistency or failure to implement. Over time, that greater consistency will help the situation enormously.
I am glad to hear that there is now a collaborative. There are 14 area drug and therapeutics committees, which is a heck of a lot of committees for a nation of about 5.3 million people. Will the review look at how they can work more closely together to integrate a lot more of what they do? My understanding of managed clinical networks is that a lot of that integration is starting to take place.
Yes. We have been encouraging more regional working and regional planning of services generally, including in that area. That work is under way.
It is, and boards are exploring how more regional structures might operate in practice. We see that already in clinical practice in some areas, and that helps the communication. The collaborative that was mentioned by Angiolina Foster will help that and will ensure consistency of information.
I have a couple of brief follow-up questions. Richard Lyle covered the issue of voting, and we have a good response on record that balances what we heard before.
Beyond the issue of pharmaceuticals, a discussion has taken place with practitioners and patient groups about the need for greater clarity. They go to meetings and, in some cases, get a good hearing, but they are then mystified as to why they are turned down. They ask themselves whether they are being listened to. There has been a call for greater clarity about the decisions that are taken following those discussions—a call for an explanation. Does the SMC accept that? Will that issue of clarity be addressed in the review? Indeed, will it be addressed at all?
Yes, we accept that we should look into that to see whether we can provide better explanations. However, it is sometimes hard to provide a full explanation because of the amount of material that is declared to be commercially confidential, particularly in relation to cost. Therefore, there is a problem with giving a full explanation. Nevertheless, that is only part of it and we will try harder to address the issue in the review process. That is probably all that I should say on that point. It is something that we will look into.
We are trying to reflect the written and oral evidence that we have received and demonstrate that we are listening.
The PACE statements are always presented very powerfully to the SMC committee. I have always reminded the committee of the powerful influence that the statements should have on decision making, which Angiolina Foster mentioned. However, for all the reasons that we have discussed, even if a powerful PACE statement is accepted, that does not mean that the SMC committee will accept the medicine. There is no question about the power of the statement.
The call was for greater clarity around those decisions.
In our previous work, we recognised not just that some of the work of the SMC is at the forefront in the United Kingdom but that the SMC is an exemplar to similar organisations that are struggling with the issues that it has been struggling with. Bob Doris mentioned that we have medicines that are given breakthrough status by regulators. We need to get some clarity on that, because we are hearing evidence about whether the whole process is fit for the future. If the SMC is to continue to be at the forefront of the work, what will we do to address the issue, which we heard about from an oncologist, that the evidence for breakthrough medicines is not as good as we would expect it to be for other medicines and new drugs? How can we ensure that, in relation to breakthrough medicines, the SMC is fit for the future?
That is a very good point. That is one of the major challenges that the SMC will face in the coming years. It is also something that we have discussed with similar groups around the world, all of which face the same kind of issue.
It is something that we are working on. In the future, we will have to come up with a mechanism to deal with the relative immaturity of the data that you referred to, because medicines are getting their approvals earlier and are coming on to the market earlier.
This may not be applicable to all those medicines, but the SMC may have to consider, as a one-off process albeit with the possibility of fairly early resubmission, some kind of conditional acceptance, with the opportunity for a review, that would be based on the real-world data—which we have been talking about—that needs to be collected about the benefits of those medicines when they are used in NHS Scotland.
The answer is yes: we are seriously considering the issue.
Will it be covered by the review?
11:00
I think that it will be covered. At present, it is difficult to use patient data from real-life situations in a systematic way to make health economic assumptions. The Scottish Government is therefore providing investment to NHS Greater Glasgow and Clyde to enable it to work with the Farr institute of health informatics research and others to look at the clinical effectiveness of cancer medicines in real-life settings, considering not just issues of access but how the medicines are used. That will give us information on medicines that have been accepted by the SMC and perhaps pointers for the future. The concept of investing in new medicines on the basis of little evidence means that giving people earlier access to medicines is definitely going to be a major decision for us going forward, as it will be for other HTA organisations. We expect that such suggestions will be put forward by the independent review, and we will want to see both national and international evidence for them.
I thank the cabinet secretary and her colleagues for their evidence and time this morning.
Last week, the patients groups and other stakeholders showed their appreciation of the progress that has been made through the Scottish Government and the committee. We should take some satisfaction from the fact that the committee, working with the Scottish Government and others, has made some progress. The word “evolution” was used, and the cabinet secretary reaffirmed its appropriateness today. There is more to be done, but progress has been made.
I suspend the meeting briefly to allow a changeover of witnesses.
11:01 Meeting suspended.